Analysts are turning increasingly bullish on Micron Technology Inc. (NASDAQ:MU) as stronger memory pricing and surging AI demand continue to support the company’s outlook.
TD Cowen Raises Price Forecast On Strong Earnings Outlook
TD Cowen analyst Krish Sankar maintained a Buy rating on Micron and raised the price forecast from $450 to $500.
Sankar raised his estimates for Micron and expects the company to deliver a strong earnings beat, while increasing his price forecast based on about 5–6 times projected 2027 earnings.
Sankar said he remains comfortable with buy-side expectations even though Micron has become a crowded long position ahead of earnings.
He still sees upside to investor expectations after the results, but believes long-term stock gains will depend more on a valuation re-rating than on near-term earnings surprises.
He expects Micron to report $10.40 in earnings per share for the February quarter, above the Street estimate of $8.82, and guide to around $13.50 EPS for the May quarter, compared with the Street estimate of $10.92.
Sankar models $65 EPS for 2026 and $90 EPS for 2027, with book value per share reaching $120 by the end of 2026 and $215 by the end of 2027.
Sankar sees additional upside of about 15% to the 2027 forecast, which could push earnings above $100 per share.
However, he expects future stock performance to depend on whether the market assigns a higher valuation multiple as pricing and earnings prove durable.
He pointed to long-term agreements (LTAs) as the most important factor supporting a re-rating.
These multi-quarter contracts could help establish a floor for gross margins after 2027. Sankar compared this dynamic to the hard disk drive industry, where LTAs and disciplined supply have helped companies trade at roughly twice the valuation multiple of memory stocks.
His industry research indicates DRAM will remain the tightest market over the next two years, followed by HDDs and NAND.
Still, Sankar warned that customer inventory buildup could trigger a correction similar to 2021–2022, with clearer signals expected in the coming quarters.
RBC Capital Sees AI Demand Extending Memory Upcycle
RBC Capital analyst Srini Pajjuri reiterated Micron with an Outperform and raised the price forecast from $425 to $525.
Pajjuri raised his estimates for Micron and increased his price forecast, citing continued strength in memory pricing and strong demand from artificial intelligence and data center markets.
Pajjuri said rising pricing trends are likely to drive another earnings beat. He noted that DRAM contract pricing is expected to rise sharply, with TrendForce projecting 80–85% growth in the first calendar quarter.
His model assumes more than 70% blended DRAM pricing growth for Micron and about 80% for NAND in the February 2026 quarter.
Based on these assumptions, he raised his revenue and earnings forecast for the quarter to $25.5 billion and $13.52 per share, up from earlier estimates of $18.7 billion and $8.42 per share, while increasing his gross margin estimate to 76.5%.
For the May 2026 quarter, Pajjuri expects a blended 20% increase in DRAM pricing and a 30% quarter-over-quarter rise in NAND pricing, resulting in projected revenue of $31.3 billion and earnings of $17.19 per share, with gross margins reaching 80.4%.
He also lifted his full-year EPS estimates to $54.30 for 2026 and $75.44 for 2027.
AI Memory Demand Drives Long-Term Growth
Pajjuri believes AI and data center demand will extend the memory upcycle into 2027. Data centers now generate more than half of industry DRAM revenue, and he expects strong demand for high-bandwidth memory (HBM) and DDR memory used in AI systems.
Micron management has indicated that HBM supply is sold out for 2026, while HBM4 is expected to begin volume shipments in the first calendar quarter.
Although Pajjuri expects HBM3E pricing to decline modestly in 2026, he believes HBM4 pricing could be 30–50% higher.
He also highlighted the growing memory capacity in next-generation AI hardware, noting that Rubin Ultra GPUs could require about 3.5 times as much HBM as earlier systems.
Overall, Pajjuri expects AI-driven demand to more than offset potential weakness in PC and smartphone markets, supporting strong growth in both DRAM and NAND through the next cycle.
MU Price Action: Micron Technology shares were up 5.47% at $449.43 at the time of publication on Monday. The stock is trading near its 52-week high of $455.50, according to Benzinga Pro data.
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